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  • FEBRUARY 2014

  • 2 | ENGAGE FOR CHANGE IN 2014

  • 2 | ENGAGE FOR CHANGE IN 2014 ENGAGE FOR CHANGE IN 2014 | 3

    EDITORSaa Maris.maric@aim.rs

    COPY EDITORChris McDonaldc.mcdonald@aim.rs

    ART DIRECTORIlija Petrovii.petrovic@aim.rs

    PROJECT MANAGERS:Biljana Devib.devic@aim.rsMarina Pilipovicm.pilipovic@aim.rsDarko Novakovid.novakovic@aim.rsMilica Pajim.pajic@aim.rs

    PHOTOSZoran Petrovi

    TRANSLATORSSneana Bjelotomi_________________________

    SPECIAL THANKS TO

    Branislav ale, AmChamAmCham Serbia

    _________________________

    EXECUTIVE DIRECTORRua Ristanovir.ristanovic@aim.rs

    GENERAL MANAGERIvan Novii.novcic@cma.rs

    FINANCIAL DIRECTORAna Besedia.besedic@aim.rs

    EDITORIAL MANAGER Tanja Bankovit.bankovic@aim.rs

    OFFICE MANAGERNataa Nein.nesis@aim.rs

    PRINTINGRotografika d.o.o.

    Makenzijeva 67,11000 Belgrade, SerbiaPhone: +(381 11) 2450 508Fascimile: +(381 11) 2450 122E-mail: office@aim.rswww.cordmagazine.comISSN no: 1451-7833All rights reservedalliance international media 2014

    4 COMMENT: SERBIAS POTENTIAL AND LIMITATIONS ANA S. TRBOVICH, Ph.D. Faculty of Economics, Finance and Administration FEFA, Belgrade

    6 BRINGING THE

    BEST OF BUSINESS TO SERBIA MILO DJURKOVI, President of AmCham Serbia

    10 PROVIDING COUNSEL

    H.E. MR. MICHAEL KIRBY, US Ambassador to Serbia

    14 AMCHAM AIMS TO ACT AS A ROLE MODEL TO SERBIA'S ECONOMY MAJA PIEVI, Executive Director of AmCham Serbia

    18 IMPORTING THE AMERICAN DREAM JANE KITSON, Commercial Counsellor at the US Embassy in Belgrade

    21 EMBRACING CHANGE TRS Europe

    22 SUCCESS POSSIBLE WITH LEADERSHIP AND SUPPORT SUSAN KOSINSKI FRITZ, Mission Director of USAID Serbia

    26 PUTTING SERBIA ON THE MAP ELJKO SERTI, President of the Serbian Chamber of Commerce (SCC)

    29 DECADE OF IMPROVEMENT STACEY KENNEDY, Managing Director South East Europe at Philip Morris International

    30 STABLE PARTNER OF THE STATE DRAGINJA DJURI, Executive Board President of Banca Intesa

    33 US COMPANY EXPLORES MINING POTENTIAL OF BOR Rakita Exploration d.o.o Bor

    34 SYSTEM OF VALUES DIMITAR ANDONOV, Operations Director for Serbia, Macedonia and Montenegro at Coca-Cola

    36 EVERY ITEM HAS A BUYER DARKO MATIJAEVI, Managing Director of Executive Group

    39 HARMONISING LEGAL NORMS VLATKO SEKULOVI, Partner at Sekulovi Law Office, Belgrade

    40 A CALL FOR DIALOGUE JASMINA PAVLOVI, Country Manager for Serbia, Central Balkan Countries and Moldova at Pfizer H.C.P. Corporation Representative Office

    41 MEETING GLOBAL STANDARDS TOMASZ ROGACZ, CEO of McDonalds Serbia

    42 ONE OF THE GLOBAL LEADERS IN DIRECT SALES VESNA KOVLJENI, National Sales Manager of Avon Serbia

    43 CONFIDENT IN PARTNERSHIP MILUTIN DELI, General Manager of GSK for Serbia and Montenegro and Commercial Director for the Adriatic Cluster

    44 EXPORTS TO US RISING Trading overview

    46 US COMPANIES IN SERBIA Investments

    47 A LIFE IMPROVED EVERY THREE SECONDS ZVEZDANA IVANOV, Country Manager for Medtronic B.V. Serbia

    48 AMCHAM IN 2013: DRIVING CHANGE!

    50 AMCHAM EVENTS IN 2013

    CONTENTS

  • 4 | ENGAGE FOR CHANGE IN 2014

    Serbias Potential and Limitations

    A merican investments in Serbia reflect both the potential and the limitations of Serbia as an investment destination. There are relatively few investments considering the size of the US economy, with the majority of US companies in Serbia operating out of small sales offices or via a representative (franchise) local company. This includes big brands such as IBM, and it is not uncommon for small countries like Ser-bia, even when you consider the larger regional market. Yet those companies that made the leap into the Serbian market tend to be satisfied with their investment, with many expanding.

    The US is one of the largest foreign direct investors in Serbia, with investments of more than US$3.5 billion and employing more than 9,000 people. These investments include Philip Mor-ris Internationals purchase of the Ni Tobacco Factory in Au-gust 2003 through the privatisation process, Colorado-based Ball Corporations greenfield investment to produce beverage cans, followed by the Coca-Cola Companys purchase of bottled-water producer Vlasinka and Merrill Lynch purchasing a 25% stake in real-estate firm MPC Properties, which subsequently built the Ue Shopping Centre in New Belgrade. In August 2008, PepsiCo in-vested more than 200 million to acquire Marbo. Other sizeable US investments came through the Darby investment fund, which presently owns the Sevojno copper mill, as well as cable production company Novkabel and Klas bread manufacturing. The KKR fund invested in flooring producer Tar-kett and SBB (Serbia Broadband), while additional direct investments were made by Van Drunen Farms, Alltech, Eaton etc. Most recently, NCR made Belgrade its headquarters in one of largest greenfield endeavours, employment-wise, engaging hundreds of university-educated people.

    Serbias primary advantage compared with other emerging markets is its European location and enhanced market access as a result of the regional CEFTA trade treaty, the Stabilisation and Association Agreement, which guarantees free trade to the EU for most products, and bilateral treaties with Russia, Turkey and sev-eral other countries. While many US investments initially targeted Serbian and regional markets, they are also exporting beyond the region. Yet the key question is why does Serbia not have more US investments, especially those featuring higher-value-added prod-

    ucts and services like those of Ball Packaging or Microsoft. Microsoft established a software development centre in Bel-

    grade in 2005, engaging in research and development rather than just the sale of software. While critical, the most decisive factor for this business development was not the availability of software engineers or English proficiency, but the desire of Serbian expatri-ates who had developed an excellent professional reputation while working for Microsoft in the US to build a local team and work from Belgrade. Today, Microsoft Serbia is a successful enterprise with an active software development centre that attracts young lo-cal talents who can develop an exciting international career while remaining in their home country. Ball Packaging, meanwhile, came in great part to serve Coca-Cola, which has been present in the Serbian market for decades and is an important buyer for alu-minium cans. It took Ball two years to overcome Serbias complex construction permitting process and build their production plant. Still, they later expanded production and the company often prais-es Serbia at international investment forums as one of their most productive facilities worldwide. In short, both Microsoft and Ball Packaging, while highly content with their investment decisions, needed an additional reason to choose Serbia over another desti-nation. To attract more of such investments, Serbia needs to first invest more in its business climate, currently ranked well below its potential even when measured by GDP in surveys such as the

    World Banks Doing Business or the World Economic Forums Global Com-petitiveness Index.

    Interestingly, Ernst & Youngs at-tractiveness survey Europe 2013 con-firms the discrepancy between the less attractive perception and the actual investment experience of companies in Serbia. The surveys results show

    that only 1% of interviewed investors (808 international decision-makers) picked Serbia as the most attractive destination in Central Eastern Europe, yet in practice Serbia scooped 11% of CEE FDI pro-jects in 2012. These results highlight the need for improved brand-ing and smarter, more consistent policies aimed at advancing the business climate, as well as the accompanying infrastructure and education, which impacts on a countrys global competitiveness. US investors in Serbia engage with the American Chamber of Commerce and other organisations to improve Serbias business environment and attract additional business to the country, as it is in American and Serbian businesses common interest that Serbia prospers economically and is anchored stably to the EU.

    Ernst & Youngs survey Europe 2013 showed that only 1% of

    investors picked Serbia as the most attractive destination in Central

    Eastern Europe, yet Serbia scooped 11% of CEE FDI projects in 2012

    COMMENT ANA S. TRBOVICH, Ph.D. Faculty of Economics, Finance and Administration FEFA, Belgrade

  • 4 | ENGAGE FOR CHANGE IN 2014

    Working Together For A Healthier World

    Pfizer HCP Corporation, Representative office BelgradeTresnjinog Cveta 1, Belgrade

    Tel: 381.11.3630 000; Fax: 381. 11. 3630 033e-mail: office@pfizer.co.rs

  • 6 | ENGAGE FOR CHANGE IN 2014

    Bringing the Best of Business to Serbia

    The most important thing AmCham be-gan with was the institutionalisation of a constructive standing dialogue be-tween the private and public sectors, with the goal of improving the business climate in Serbia, says AmCham Serbia President Milo Djurkovi of measures he believes to have been successful. Naturally, he goes on, when dia-logue at an institutional level is initiated, many topics of interest for companies and the overall economy emerge. Djurkovi is proud of such achievements and advances made by AmCham during its time in Serbia. Now, AmCham is look-ing to build on them and develop a generation of uncompromising new Serbian business leaders.

    What are AmChams current priorities?- Our current priorities relate primarily to a series of measures that need to be implemented